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Author Topic: sharestates? (real estate p2p)

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sharestates? (real estate p2p)
OP: December 07, 2021, 06:13:34 PM
Anyone have any experience with sharestates?

I created an account, but the first thing I notice is that there are only 2 loans open for funding.  Are these guys too small to be of value?

I'd like any feedback from sharestates users.

I've been investing for several years at groundfloor, and they have dozens open at once.
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sharestates? (real estate p2p)
#1: December 16, 2021, 02:14:30 AM
I've been tracking Sharestates, Peerstreet, and Yieldstreet. Yet to pull the trigger on any of them. Peerstreet seems to have some volume. Yieldstreet has some interesting alternative investments, I'm close to trying them out. I like Fundrise, Realty Mogul, and Crowdstreet, have had good experiences on all those platforms.
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sharestates? (real estate p2p)
#2: December 16, 2021, 04:18:26 AM
I am in groundfloor.us  .  I'm always surprised when they don't often get mentioned in a list such as they one you gave.

They have a large # deals open at any one time, so I have no trouble investing a bunch of cash when I dump it in.

I'm looking to maybe diversify, as these are all small companies, and that led me to look into Sharestates, which led me to the question above.

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sharestates? (real estate p2p)
#3: December 16, 2021, 02:50:59 PM
Sorry I can't offer any experience with Sharestates. But can you offer your experiences with Groundfloor? Have you experienced any defaults or delayed payments?
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sharestates? (real estate p2p)
#4: December 16, 2021, 02:54:49 PM
I also invested on LendingHome (now Kiava). I used their auto-invest feature, but experienced too many defaults. Foreclosures took a long time, and I often did not get all the principal back.
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sharestates? (real estate p2p)
#5: December 17, 2021, 08:21:10 AM
Sorry I can't offer any experience with Sharestates. But can you offer your experiences with Groundfloor? Have you experienced any defaults or delayed payments?

Sure.  Lots.  A significant fraction of the loans default.  (I don't have stats in front of me at the moment.)  However, these are secured real estate loans, so after a considerable delay where they dive in and work with the borrower, then they move thru a complex set of legal steps to foreclose, and then eventually you get your money back.  Unless they have mis-appraised the property, you get your money back.   There's just a delay.  Requires a bit of patience.  This is VERY different from the situation at LendingClub or Prosper, where defaults almost always result in total loss of investment.

One aspect of this situation is that it takes a long time to understand how well you're doin'.  You have to allow time for defaults to work out.  My spreadsheet shows I'm makin'  6.88% IRR after everything, even including my estimate of what fraction of the currently defaulted loans will pay off.  My return has been remarkably consistent over time. 

You used the words "delayed payment", but this is essentially the same as default.  Most of the Groundfloor loans have only one single payment, at the end of the loan, usually 1 year from start.  That's another reason it takes a while to understand how well you're doin'.  You don't get that monthly feedback like you do at LC and Prosper.  If you want to calculate your return in a meaningful way as you roll along, you have to include a term for accrued loan payments discounted by some guessed loss fraction.

I might mention that my 6.88% is lower than Groundfloor's return estimates.  This is exactly the same as the situation at LC and Prosper.  In the case of Groundfloor, one of the substantial reasons their estimate and mine differ is that my money sits allocated to loans that are not yet funded for a considerable time.  I commit the money, and then it can take a couple of weeks for the loan to close.  They compute return based on invested money, and I compute return based on my whole account.  There may be other reasons, but I compute IRR based on my account value, and I'm happy with the result.

I invest, as I did at LC and Prosper, in mostly the higher quality loans, and avoid a few states I consider sketchy.

I started investing at groundfloor in 9/2015, so that's a 6 year track record.
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sharestates? (real estate p2p)
#6: December 20, 2021, 12:26:15 PM
Thanks for the detailed summary! I decided to try groundfloor out, invest in some loans that mature in the next few months..
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